21
May
10

British Airways posts another record annual loss

NEWS
British Airways posts another record annual loss

Friday, May 21, 2010

British Airways has posted a record annual net loss of $754 million, due to the recession, a tough winter and strikes by cabin crews in March.

Friday’s earnings update from the carrier – which is currently facing 15 more days of walkouts in a bitter dispute with cabin crews over changes to pay and working conditions – is slightly better than had been feared.

The loss for the year ending March 31 compares with a loss of $517.883 million in the previous year. Revenue dropped 11 percent to $11.558 billion.

British Airways (BA) says it is making progress on a cost savings program that has included cutting jobs. It has warned the Unite union that the disputed changes are necessary for the airline to survive in a post-financial crisis world.

The airline said revenues had plunged by $1.447 billion, although this was offset by falling fuel costs as well as savings elsewhere in the business.

Chief executive Willie Walsh also fired a broadside at unions after Unite on Thursday won its appeal against the latest strikes being ruled out on a technicality.

‘Returning the business to profitability requires permanent change across the company and it’s disappointing that our cabin crew union fails to recognise that,’ he warned.

He added that the current financial year ‘could hardly have had a worse start’ due to the disruption caused by Iceland’s volcanic eruption, which closed most of European airspace for almost a week in April.

Following the court decision, 15 days of strikes are due to kick off on Monday.

But the group said market conditions were showing improvement and BA is expecting to break even this year following its heavy losses.
• Source(s): British Airways PLC and Sky News / British Sky Broadcasting Ltd. (BSkyB) / News Corp.
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